The California Department of Human Resources believes the option to work remotely has great benefits for California State employees, which is why they have encouraged remote work in certain positions. All is not necessarily lost for employees forced to work at home. It should be noted that what constitutes “reasonable” is a fact specific exercise and that employers should approach each employee reimbursement request as such. Mandatory remote work expenses must be reimbursed in California. California law only requires reimbursement of expenses that are necessary to perform your work duties. As a result, many employers had to rapidly adjust to utilizing a virtual workforce. In the event of an audit, employees must be able to produce receipts substantiating the amount claimed. Employers should have a written reimbursement policy that requires employees to submit reimbursement requests by a certain deadline after the expense is incurred. In response to the COVID-19 pandemic and state and local quarantines, many employers directed employees to work from home. Employers don’t have to pay their non-exempt (hourly) employees for an ordinary commute to and from work, even if an employee reports to different locations. An Employer’s Duty to Reimburse. Concerning nonexempt employees, however, employers need to not only keep track of and pay for any overtime worked, but managers also need to e… CalHR also feels that the communication between employers and other employees is key to an effective home-work environment. In a handful of states, employers must reimburse employees for all expenditures incurred in performing their duties at home. This can be tricky, however, as the employer must be sure to document/identify the amount of compensation attributable to the expense actually incurred. 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More specifically, in addressing whether “businesses and other employers [are] required to cover any additional costs that employees may incur if they work from home (internet access, computer, additional phone line, increased use of electricity, etc. The law is intended to prevent employers from passing on their operating expenses to their employees. What documents do I need to file a wage claim in California? This was true before the pandemic; but now that more employees than ever are Read More » ; but now that more employees than ever are working from home, there are still a lot of questions. Expenses associated with maintaining a home office could also be reimbursable since it is now required to have a physical space at home devoted to company work, until the COVID-19 restrictions are lifted. If you are unable to work (or telework) because you are caring for a child whose school or place of care has been closed, or whose child care provider is unavailable, for reasons related to COVID-19. No, an employer is not typically required to reimburse an employee for business-related expenses when they are neither required nor encouraged to work from home. Those costs can include the purchase of … If California does not require employers to pay for mileage from home to work, but the work address is constantly changing, how is this handled? If so, you may consider offering work-from-home reimbursement to help workers cover remote-related expenses. Are you getting paid your rightful overtime wages? If providing employees reimbursements on a periodic basis, an employer should perform an analysis to ascertain an amount of reimbursement that is adequate to cover the actual expense incurred by the employee. Employers should also reassess their employee reimbursement policies in order to ensure they remain compliant. In a handful of states, employers must reimburse employees for all expenditures incurred in performing their duties at home. They should not be construed as legal advice, and readers should not act upon the information contained in these publications without professional counsel. In fact, employees throughout California may be owed significant compensation for basic work-from-home expenses. Other states (like Alaska and Arkansas) require reimbursement only if equipment purchased by employees for work-related purposes “cannot be used during normal social activities of the employee” or if the purchase/expense would bring the employees compensation “below minimum wage.” (8 Alaska Admin Code Section 15.165; Code of Arkansas Rules and Regs., 010-14-107(B).). Expense Reimbursement for Employees Working Remotely. An employer will want to maintain records as to reimbursements made to employees and the rationale behind those reimbursement amounts. An employer is likely not responsible for the entire personal cell phone bill of an employee simply because that employee uses his/her personal cell phone for work purposes. Costs of working remotely or working from home, including home office equipment, supplies and internet service, Work-related use of a personal vehicle (mileage reimbursement), Purchase of a cellphone for work-related use or reimbursement of a reasonable percentage of your personal cellphone bill if your employer requires you to use your personal cellphone for work-related purposes, Time for work-related communications, whether by email, chat, phone or walkie-talkie, Purchase and maintenance of work-related uniforms, Cost of purchasing other tools or supplies you need to do your job. Exactly what qualifies as "necessary expenditures" can vary from state to state, however. Those eligible will have the rebuttable presumption if they tested positive for COVID-19 or were diagnosed with COVID-19 and confirmed by a positive test within 14 days of performing a labor or service at a place of work after the stay at home order was issued on March 19, 2020. For example, construction crews work at one site for one week and drive from home straight to the job and next week they finish and start a new job in a different City. If you have questions about any of these matters, contact an employment law attorney as soon as possible. 180,485 Work From Home jobs available in California on Indeed.com. Like most of the other states who require it, California says that employers must reimburse at-home workers for "all necessary expenditures or losses" they incur while performing their jobs. Working remotely is legal in California, and it carries unique considerations. The Mileage Reimbursement Method. Is work from home reimbursement taxable? The California Labor Code – and, consequently, Section 2802 – only … When employees work from home and/or set their own working hours, an … Under the California labor code, section 2802, all business use of a personal cell phone must be reimbursed. In some states employers are required by state law to reimburse their employees for their necessary job expenses. California law only requires reimbursement of expenses that are necessary to perform your work duties. Expense reimbursement lawsuits were already commonplace before the pandemic, and with no end in sight to the pandemic and employees working from home, employers can expect additional lawsuits to be filed. Both the employer and employee should be clear about expectations and develop a mutually agreed upon system for record-keeping and hours worked. For those employees not required to go to the office location, document that they are serving at, and for, the convenience of the employer by working from their home location for the employer’s business purposes. Employers typically save money when people work from home, for a range of reasons — from spending less on office space to getting more of a worker's time when their commute is eliminated. Employers requiring employees to work from home during COVID-19 quarantines should promptly review and update their expense reimbursement policies. With this unprecedented shift in working habits, employers may be overlooking business-related expenses being incurred by their employees. Working from home has recently become the new normal, leaving office buildings empty and employees, at all levels, seeking out new ways to connect, collaborate and get their jobs done. Read on to learn what a work-from-home reimbursement covers, tax details, and state guidelines. – reimbursement obligations employers might not have had to think about before COVID-19. Labor Code section 3600 states that an employer is liable “for any injury sustained by his or her employees arising out of and in the course of the employment.” Liability for an injury sustained by an … In California, that can include home internet bills. Section 39-2-701(1)). All Rights Reserved. However, there are some costs that employers know employees will incur on a monthly basis and so it may make sense to provide a reimbursement on a more periodic basis. Of course, the transition back to the office will most likely not be instant, so it’s good to be prepared for post-pandemic remote work reimbursement tax implications. These include California, Illinois, Iowa, Pennsylvania, Montana, and New Hampshire. Did you know that California Labor Code Section 2802 requires employers to reimburse employees for any necessary expenses the employees incur while doing their jobs? California’s Labor Code Section 2802 normally requires employers to reimburse employees for “reasonable” and “necessary” expenses incurred while performing their job duties. Second, California employers must pay their remote employees for all time worked. Where the use of equipment is for both personal and business use, such as a cellphone, and the actual cost of an employee’s cellphone use for work cannot be determined — for example, if an employee has an unlimited minutes/texting plan — the employer is required to reimburse the employee for a “reasonable percentage” of the personal cellphone bill. Remote work expenses traditionally have not been reimbursable under California law because telecommuting and remote work opportunities are not mandated by the employer, as many companies have optional work-from-home programs that are at the employees' convenience, and such employees continue to have the option to work in their … In California… However, because of the “new normal” of working from home, employers must vigilantly analyze the types of expenses their employees are incurring for business-related purposes and provide reimbursement accordingly. In California… Not doing so could subject an employer to potential liability. Authorship Credit: Carter Norfleet and Shareef Farag. This will help combat employees sitting on reimbursement requests for months or years, but ultimately the deadline to submit a reimbursement request will depend on state specific laws where they exist. Before you decide, ask us to send you written information about our qualifications and experience. As remote work takes off, the issue of home-office reimbursements could become a legal one, said Josh Henderson, a labor lawyer and partner at Norton Rose Fulbright. California is in the forefront of states mandating that employers reimburse employees for work-related expenses. California’s law has been interpreted to require reimbursement of a “reasonable percentage” of an employee’s monthly bill for Internet or mobile device data plan, even if the employee does not incur any additional cost for using the Internet or mobile device for work (e.g., unlimited data plan). Employers requiring employees to work from home during COVID-19 quarantines should promptly review and update their expense reimbursement policies. Did you know that California Labor Code Section 2802 requires employers to reimburse employees for any necessary expenses the employees incur while doing their jobs? 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